Rhodia upsizes bond deal to €1 billion, adds senior tranches, issues talk, to price Tuesday

By Paul A. Harris

St. Louis, May 16 - Rhodia SA upsized its high yield bond deal to €1 billion equivalent from €700 million, introduced structural changes and issued price talk on Friday, according to a market source.

The deal is expected to price on Tuesday, the source added.

Goldman Sachs & Co., Bear Stearns & Co.and BNP Paribas are joint bookrunners on the Rule 144A/Regulations S deal.

The French specialty chemical manufacturer will now issue four tranches of notes instead of two. The deal continues to be in both dollars and euros.

Rhodia added €400 million equivalent in dollar- and euro-denominated tranches of senior notes due 2010, non-callable for four years.

Price talk on the dollar denominated senior tranche is 7 3/8%-7 5/8%, while talk on the euro senior notes tranche is 37.5 basis points area behind the dollar tranche.

The company decreased its previously announced dollar and euro tranches of senior subordinated notes due 2011 to €600 million equivalent from €700 million equivalent.

The dollar-denominated senior subordinated notes are talked at 150 basis points area behind the dollar denominated senior notes tranche, while the euro-denominated senior subordinated tranche is talked at 37.5 basis points area behind the dollar-denominated senior subordinated tranche. Both tranches of senior subordinated notes will be non-callable for four years.

Proceeds from the bonds will be used to repay short-term debt and for general corporate purposes.

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